Consumer10/11/2026

Court Approves Class Action Over Interest on Balances at Four Banks

The Central District Court in Lod approved hearing a customer lawsuit against Bank Leumi, Israel Discount Bank, Mizrahi-Tefahot Bank and First International Bank as a class action. The customers are seeking compensation for the failure to pay interest on balances in current accounts, but the banks’ liability has not yet been determined.

Key facts

•Court: Central District Court in Lod
•Defendants: Bank Leumi, Israel Discount Bank, Mizrahi-Tefahot Bank and First International Bank
•Claim period: the years 2022–2025
•Estimated non-interest-bearing funds: approximately NIS 400 billion
•Estimated damages: NIS 3.62 billion–NIS 5.06 billion
•The case number and date of the decision are not stated in the source

Who Petitioned the Court and on What Grounds

The lawsuit was filed by customers Noam Brodsky, Natali Sharban, Saar Brodsky and Zvi Hoch. They argue that during the years 2022–2025, the banks should have paid interest on credit balances in current accounts, or at least informed customers of the possibility of transferring the money to an interest-bearing deposit. According to the plaintiffs’ estimate, approximately NIS 400 billion was held at the four banks in non-interest-bearing accounts, and the group’s total damages are estimated at NIS 3.62 billion to NIS 5.06 billion.

What the Court Approved

Judge Shmuel Bornstein approved conducting the proceeding as a class action based on a restitution claim under the doctrine of unjust enrichment. The court permitted consideration of the claim that the banks generated additional profit by using customers’ funds without paying them reasonable interest. By contrast, the causes of action concerning deception, breach of fiduciary duty and breach of the duty of good faith were dismissed.

What Remains to Be Decided

The decision merely approves conducting a class action proceeding and does not constitute a final determination that the banks are liable or an award of compensation. The banks are expected to seek leave to appeal to the Supreme Court; Israel Discount Bank reported to the stock exchange that it is considering such a step. A separate proceeding against Bank Hapoalim is expected to enter the evidentiary stage in January, but its outcome is not stated in the source.

Why the Decision Is Controversial

Supporters of the decision view it as a response to the unfair distribution of income created after interest rates were raised. Critics note that no obligation to pay interest on a current account was established, that the parties’ relationship is governed by contract and that the Banking Supervision Department supported the banks’ position. They also warn that possible payments totaling billions of shekels could affect the cost of credit and other banking services.

What this means for you

For customers of these banks, the decision does not yet create an automatic right to payment: the dispute has only been approved for consideration as a class action. If the lawsuit is ultimately accepted or the parties reach a settlement, a mechanism may be created for returning funds to members of the relevant group. An appeal and a modification of the decision by a higher court remain possible.

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Case analysis based on court rulings